The Summer Sizzle

June 23, 2011 by · Leave a Comment 

By Sumayyah Meehan, TMO

sun-sky-lg-ua4ksuLast summer was one of the hottest on record for many parts of the Middle East with Kuwait having one of the most scorching summers ever. Forget about frying an egg on the sidewalk, in Kuwait you could roast an entire chicken on a garden wall or even a park bench. During the peak hours of the day, when the desert sun is at its most unforgiving peak, the streets of Kuwait are deserted leaving an entire nation looking like a ghost town. There really is not a whole lot to do outdoors when the mercury exceeds 100F and often reaches well above 115F. So where does everyone go?

For many of the denizens of Kuwait, hanging out in a heavily air-conditioned mall or catching Hollywood’s latest offering at a perfectly chilled movie theater complete with snacks is the best way to beat the scorching summer heat. For a very brave minority, who are willing to brave the heat, there are a limited number of water activities to engage in. Jet skiing and swimming, in the somewhat cool waters of Kuwait, are the top summer activities for adults and children alike. Many families wait until the sun goes down to hit the beaches of Kuwait and often spend the evening frolicking in the ocean despite there being limited lighting, no lifeguards on duty and razor sharp rocks just at the water’s edge.

One of the greatest pastimes during the summers in Kuwait is simply spending the day indoors at home. It might sound boring, but with a veritable smorgasbord of companies catering to people lounging around at home, the phrase “cabin fever” is meaningless. In Kuwait you can have just about anything, including the kitchen sink, delivered right to your door. Groceries, fresh fruit and vegetables as well as donuts, pastries and ice cream are just a few of the edible items available for delivery. Electronic goods, designer perfumes, Swiss chocolates, high-end toiletries and even home appliances are some of the others.

For people wanting just a little bit more pampering and luxury in the comfort of their own home, without any of the fuss, teams of caterers will arrive at the door to cater a party or even prepare an elaborate barbeque right in the backyard. There is even a new delivery service available that provides “shisha” pipes for use at home complete with a server to light the charcoal. And if that’s not enough, why not have a team of manicurists and masseuses come over to pamper everyone in the home?

The summers may be hot in Kuwait, and while they absolutely do force a mass exodus of travelers who are seeking cooler temperatures, those left behind can still enjoy a little bit of luxury without even setting foot outdoors.

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A Summer of “Sandboarding”

June 16, 2011 by · Leave a Comment 

By Sumayyah Meehan, TMO

extreme-sports-wallpaper-sand-boardingOne of the biggest complaints often heard by residents, and visitors alike, is the lack of sporting activities in the Middle East. The lack of outdoor activities is not surprising given that eight months out of the year are sweltering with temperatures easily reaching well above 100-degrees Fahrenheit. The greatest pastimes for most denizens of the wealthy gulf regions of the Middle East are usually fine dining or shopping in heavily air-conditioned malls. However, a new breed of daredevil is weathering the scalding desert sun and taking advantage of one of the most plentiful resources in the desert. Sand.

Sandboarding is believed to be a sport invented by the Egyptians, however, there is not credible data available today crediting Egypt with developing the sand sport. Over the past year or so, sandboarding has swept across the Middle East and become the most popular desert activity. Sandboarding combines the best moves and techniques from three sporting activities- skateboarding, surfing and snowboarding. And it requires a very large sand dune in order to fulfill all the twists, jumps and tricks that sandboarders dare to perform.

It can take several minutes for a sandboarder to ascend his sand dune of choice and a mere couple of minutes to cruise down it. For this reason, a sandboarder must be aware of the effects of performing a high-intensity sport in the scorching desert sun and must take preventative measures to ensure his safety and the safety of those sandboarding with him. As a rule, most sandboarders choose the early morning hours just after the crack of dawn to ride the dunes. The heat of the sun in the region reaches full capacity in the early afternoon. Sandboarders must carry several liters of water with them in addition to their sandboard.

One of the most popular sandboarding sites is located in Dubai, which is a municipality of the United Arab Emirates (UAE). There is an abundance of naturally occurring sand dunes in the UAE, some scraping the sky at over 200 ft. However, the largest one stands at a dizzying 300ft. It is known by sandboarders as “Big Red”, however locals refer to it as “Al Hamar”. Regardless of the name, the sand dune is very steep and it is bright red due to high-levels of iron oxide. Daredevils congregate near “Big Red” on weekends and a crowd gathers at the base to watch the show.

Sandboards can be purchased in local sporting good shops in most Middle Eastern countries and are even available online. Ingenious businessman, in both the UAE and neighboring Arab States, have created special sandboarding excursions which provide sandboard rentals and transportation to and from the dunes.

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Islamic Trusts Could Revive Gulf Property Market

June 9, 2011 by · Leave a Comment 

By Shaheen Pasha

2011-05-28T211614Z_2103306788_GM1E75T0ESH01_RTRMADP_3_EMIRATES

A dhow sails during the Al-Gaffal 60ft traditional dhow sailing race between the island of Sir Bu Nair near the Iranian coast, and Dubai May 28, 2011.

REUTERS/Stringer

DUBAI, June 2 (Reuters) – Jordanian Ashraf Hamdan began investing in Dubai’s real estate market in 2006, with a few modest rental investment forays before turning his sights on flashier projects as a wave of luxury developments hit the market.

The real estate bust in 2008 left investors like Hamdan with half-finished projects sitting in the desert sun and losses that were unlikely to be recouped.

“It was a costly learning experience for a real estate investor,” said the 53-year-old businessman. “But real estate is in our blood here in the Arab world. It’s a tangible investment, and from an Islamic perspective, that appeals to me.

“I’m just going to be looking for smarter, alternative ways to get into the market in the future.”

The emergence of Islamic real estate investment trusts (REIT) in the Middle East, which offer the chance to own shares in a portfolio of real estate assets with a steady paid dividend from the income earned on those assets, may lure investors like Hamdan back to the sector again.

Islamic REITS differ from their conventional counterparts by banning investment in any assets that pay interest or conduct business in any forbidden industry, like gambling, alcohol or adult entertainment.

Aside from providing an alternative investment in the Gulf Islamic finance industry it could also inject more transparency and regulation in a property sector plagued by unrealistic expectations of returns and occasionally murky dealings.

“Over the last two or three years, people have been in freeze mode where the focus was cash and other liquid things,” said Daniel Diembers, principal at Booz & Company in Dubai.

“The Dubai bubble really helped the (property) market to mature. Now is the moment where it is all shifting. There is a lot of wealth up for grabs.”

Globally, the market capitalisation for REITs was around $570 billion at the end of 2009, a 2010 Ernst & Young study said. Islamic REITs play a small role, with Asia serving as the predominant hub for sharia-compliant trusts.

Renewed Confidence

Malaysia’s Axis Global Industrial real estate investment trust (REIT) is planning an initial public offering with an asset size of $1.05 billion, making it the world’s largest Islamic REIT.

Islamic REITs launched in Bahrain and Kuwait have been relatively small in size – Bahrain’s Inovest REIT and Kuwait’s Al Mahrab Tower REIT launched with less than $95 million in capital each – and neither has been publicly listed.

But an anticipated infrastructure boom in hot markets such as Saudi Arabia and Qatar and the launch of the UAE’s first Islamic REIT may buoy faith in real estate investments, creating a wider niche for the Sharia-compliant trusts to thrive.

Emirates REIT, which launched with seed capital from Islamic lender Dubai Islamic Bank last November, is aimed at medium-income investors and offers returns of 6 to 8 percent annually, said Mark Inch, director of Eiffel Holding and founding shareholder of Emirates REIT.

“There is a discipline and transparency that comes with a regulated REIT,” he said. “Buildings will not only be properly managed but financial management will also be completely transparent. It’s a prerequisite of bringing back confidence.”

Emirates REIT has 40 deals under review ranging between 40 million dirhams to 500 million dirhams and will be fully operational by the summer, Inch said. An initial public offering is planned within 18 months to two years once it secures assets of 1.5 billion dirhams.

The interest is growing. National Bank of Abu Dhabi is considering creating an Islamic REIT while the FTSE Group may develop an Islamic REIT index as the industry grows globally, officials at both said.
The Gulf region has dabbled in the REIT market over the years with little success.

A 2008 Islamic REIT launched by Saudi Arabia’s Sumou Holding and Geneva-based Encore Management fizzled in the kingdom as the financial crisis sapped enthusiasm. Other attempts to launch a REIT in the region, including a conventional one by troubled property developer Nakheel, were quickly squashed.

Asia, by comparison, has seen a boom in sharia-compliant REITS. Malaysia, considered to be at the forefront of Islamic finance, launched its first Islamic REIT in 2006. Singapore’s Sabana REIT, launched in 2010, was 2.5 times oversubscribed and saw heavy investor interest from the Gulf.

The Gulf has been held back by the slow pace of innovation in the real estate sector, as well as the Islamic finance industry in general, experts said.

In contrast to Malaysia, where the government is active in creating a strong regulatory environment, there is no regulatory standardisation in the Middle East. And investors are understandably wary of investing in a new real estate venture given the spectacular property collapse in the region.

Oz Ahmed, associate director of wholesale banking at HSBC Amanah in Malaysia, said Mideast investors seem ready for homegrown REITS given the high participation in Asian ones.

“There’s definite potential for issuers within the GCC to identify assets but people have to become comfortable with them,” he said.

“We’ve gotten to the point where we’re working well in the banking paradigm. Now practitioners are looking to develop products that come closer to Islamic finance principles.” (Editing by Amran Abocar and Jon Hemming)

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